Chennai:
With the rupee in a free fall, gold prices hit a record high of Rs 34,500 per 10 grams today. Surprisingly, the demand for gold also seems to be soaring along with the price.
At a gold shop in Chennai, Madhu Chandran's family is on a buying spree. They are investing more than Rs 2 lakhs in gold jewellery for their daughter.
"It is the only thing that keeps going up in this country. We don't see it coming down. So we buy a gram today and if you want to sell a year later, you are going to get more. It is a good investment. Any time is a good time to invest," said Madhu's father.
Just yesterday, Finance Minister P Chidambaram had appealed to people to moderate the demand.
He had explained that India's current account deficit stood at 38.7 billion dollars in the first half of this year. This is partly due to sharp decline in exports. But it is the import duty on the yellow metal that accounts for a whopping 20 billion dollars.
In another part of the city, Nirupama Esvaramurthi, a student of management, sees sense in the finance minister's appeal. Thanks to Nirupama's conviction, her mother would now put on hold their monthly purchase of gold for Nirupama's wedding later.
"Rather than keeping our personal interests in mind and buying lots of gold, it is high time we keep the country in mind by cutting down its purchase," says Nirupama.
But she could be a minority. Even as gold price shoots up, buyers are only flocking with more money, planned or panicked.
Gold at any price is seen to be a safe bet for investment. Its wedding season and not many are listening to the finance minister's appeal.